Alan Krueger: Reversing the Middle Class Jobs Deficit

Chrystia was more balanced in this interview than in past interviews I have seen her conduct. Either her firm political convictions have changed or she left them at home that day. It must be terrible for an honest person to be a presidential advisor. Alan Krueger had to perform a sales function that he did not seem to relish completely. On the big issue: the administration apparently is not ready to level with the American people on what it will take to restore balance to this economy in the long haul. The reason job growth is so slow is that people's wages are above market clearing levels. An unpleasant conclusion, I know. As Mr. Krueger accepts, I am reasonably sure, full employment requires lower wages or higher productivity. The global labor market has become highly competitive and is only going to become moreso. That is good for the "have lesses" of the world. But it is tough on Americans that are not globally competitive. Education is a key to productivity gains, and Mr Krueger emphasized education in his remarks. Unfortunately the Obama administration is stymied by education reform. Relative to other countries, if productivity doesn't rise, US living standards will necessarily fall. That's enough to get a messenger shot.